1. Suppose a farmer wants to purchase a tractor to replace animal traction on his 50...

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1. Suppose a farmer wants to purchase a tractor to replace animal traction on his 50 hectares of land. After a cost and returns analysis, he realized that the decision will have no effect on his produce and returns, however, tractor would cost him MWK 100,000 on depreciation per season/year, MWK 80,000 on interest, MWK 10,000 on taxes and MWK 30,000 on insurance. He further estimated costs of repairs (MWK 25,000), fuel and lubricants (MWK 13,000) and salary for the driver (MWK 550,000 per season). Animal traction was costing the farmer on repairs and maintenance a total of MWK 5,000 per hectare on ploughing and MWK 2,500 per hectare on ridging. The farmer was paying the person leading the animals a total of MWK 250,000. Prepare a partial budget and comment on your findings (10 marks) 2. Assuming the production function describing the relationship between maize yield and nitrogen fertilizer is given as follows: y = 0.75x + 0.0042x-0.000023.x, and input levels as shown in table 1, calculate the following: a. Total Physical Product (TPP) b. Average Physical Product (APP) c. Marginal Physical Product (MPP) (2 marks) (2 marks) (2 marks) d. Write the equation or function used in calculating the MPP (4 marks) Table 1: Nitrogen levels Nitrogen level 20 40 60 80 100 120 140 e. Suppose the output price is MWK 400 and input price MWK 200 the TVP, MVP and the Profit at each level of nitrogen fertilize Late 1. Suppose a farmer wants to purchase a tractor to replace animal traction on his 50 hectares of land. After a cost and returns analysis, he realized that the decision will have no effect on his produce and returns, however, tractor would cost him MWK 100,000 on depreciation per season/year, MWK 80,000 on interest, MWK 10,000 on taxes and MWK 30,000 on insurance. He further estimated costs of repairs (MWK 25,000), fuel and lubricants (MWK 13,000) and salary for the driver (MWK 550,000 per season). Animal traction was costing the farmer on repairs and maintenance a total of MWK 5,000 per hectare on ploughing and MWK 2,500 per hectare on ridging. The farmer was paying the person leading the animals a total of MWK 250,000. Prepare a partial budget and comment on your findings (10 marks) 2. Assuming the production function describing the relationship between maize yield and nitrogen fertilizer is given as follows: y = 0.75x + 0.0042x-0.000023.x, and input levels as shown in table 1, calculate the following: a. Total Physical Product (TPP) b. Average Physical Product (APP) c. Marginal Physical Product (MPP) (2 marks) (2 marks) (2 marks) d. Write the equation or function used in calculating the MPP (4 marks) Table 1: Nitrogen levels Nitrogen level 20 40 60 80 100 120 140 e. Suppose the output price is MWK 400 and input price MWK 200 the TVP, MVP and the Profit at each level of nitrogen fertilize Late

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1 Partial Budget Analysis To conduct a partial budget analysis we compare the costs and returns associated with two alternatives using animal traction and using a tractor Based on the provided informa... View the full answer